Delay, Confuse and Discourage – Long Term Care Insurance Claims Procedures

Introduction

I often say that Long Term Care Insurance (“LTCI”) is important to have.  It’s important because most of us will need caregiving services during the last part of our lives, and unfortunately those services are not covered by Medicare or other third party payers.  Most of the time, it’s only LTCI that will cover at least part of the cost of that care.

However, I also often say that Long Term Care Insurance is difficult to collect on.  It’s hard to collect on because most (but not all)  LTCI companies’ claims filing and reviewing processes have the effect of:

1. Delaying the approval of the claims and the payment of benefits
2. Confusing the persons who are trying to file the claims on behalf of the insureds
3. Discouraging the insureds and the people helping them and sometimes making them just give up on what are perfectly valid claims

Please notice this:  I say that most LTCI companies’ claims procedures have the effect of delaying, confusing and discouraging claims.  I do not claim that LTCI claims procedures are designed to produce those effects, but they very often do produce those effects.

A Recent Example

Recently, we ran into yet another real-life situation where a client is receiving this sort of disservice by a LTCI company.  In this case, the events described below would have resulted in a delay of at least five weeks before benefit payments begin, as a result of three separate delays, if we weren’t experienced at anticipating and avoiding such tactics.

Delay no. 1:  On 4/4/14 we received a letter from a LTCI company about a new claim.  The letter said that the LTCI company still needed to receive our visit notes in order to evaluate the claim.

The letter was dated 3/26/14.  HOWEVER, the postmark (postage meter stamp) on the notification letter was 4/1/14, one week later than the date on the letter.  It so happens that we had already faxed our visit notes to the insurance company on 3/27/14.  Our client was fortunate to be working with us because we know not to wait for the insurance company to request the visit notes, and the claim would have been delayed.

For those keeping score at home, that’s a one week delay. 

“But wait, there’s more”

Delay no. 2: I called the number on the letter and spoke to the claims representative who answered call.  For purposes of this story, I’ll call her Helen, but that’s not her real name.

Helen told me that the visit notes had indeed been received, but that the LTCI company had decided to reject the visit notes.  Although the visit notes were signed and dated by our caregivers, Helen said that the LTCI company decided to rejet them because the insured had not also signed and dated the visit notes.  Helen told me that the claims instructions contained instructions regarding that requirement for a client signature.

I checked afterward and there is no such language in their claims instructions.  In other words, it’s a documentation requirement that they don’t tell you about but then use as the basis for delaying the claim further.

Also, note this:

• We have worked with most of the major LTCI companies in the past and none of them have ever imposed this requirement.
• Until I called the LTCI company on 4/4/14, they had not notified us nor the client that the notes had been rejected.

I asked Helen why the LTCI company had not yet notified us that the visit notes were rejected.  She said that they would have “eventually” notified us but she couldn’t say how long they would have waited before notifying us.

We will have the client’s legal representative sign and date the visit notes right away.  (That person is the client’s daughter, who is always at the client’s home and therefore can attest to our visits having taken place).  We’ll fax them in to the insurance company immediately.

For those keeping score at home, that’s an additional delay.  We don’t really know for certain how long they would have waited before notifying us of the rejection, since Helen didn’t know, so for purposes of this story we’ll be conservative and speculate that it would have only introduced another two weeks of delay.

After you submit again, they’ll make you wait again

Delay no. 3:  While I was talking with Helen about this, I asked her how long it would take the LTCI company to process the visit notes again and decide whether they were acceptable.  Helen told me it would take ten business days.

For those keeping score at home, that’s an additional delay of two weeks.

Summary

In all, that’s a total delay of five weeks.  And that’s just the delay with respect to the relatively simple matter of visit notes!

How does this compare to your experiences when filing LTCI claims?  Please add your comments and experiences below!

 

 

Photo by ajvin